Responsible

HOA "managers" range from the completely untrained to the highly trained; from the newbie to the uber-experienced, sometimes reaching a place where they are "overbaked" or "burned out". Manager types range in stature from the backpack wielding casual to the stiff 3 piece suiters full on equipped with calfskin briefcases. They range from the "don't worry about rules" to the "Nazi"-style oversight. They range from the completely competent and trustworthy to the unethical and immoral. (Just like directors, and just like lawyers.)

What should you look for in a manager? Definitely something in between the extremes for the most part. But don't skimp on quality. Search for a completely competent and trustworthy person. Quality trumps glitz, hype, and price.

What else is important? I have written and read many accounts, and have talked to many unsatisfied boards, so I have heard a lot about what boards don't want. On the other hand I have worked with specific managers who I would feel good about recommending. Some names I would not give to anyone based on what I have seen. And even the managers I trust to provide good management services might not be "a good fit" in all circumstances, because boards look for different things in management. Some boards want complete hands on guidance relieving them of work and others want to micromanage. If the manager hired does not recognize this and role with it, it can lead to considerable friction.

Managers are who are astute, competent, and capable of a chameleon-like ability to adapt to various boards and a variety of associations are to be valued. I really believe this ability to adapt between the large and small associations is more easily accomplished by a manager from a smaller company where there's room to exercise some individuality. (Same for lawyers.) In some of the large companies I have seen too much "corporate" stringency and intent to treat HOAs as "one size fits all." Of course, ask any manager what is important and they will tell you everything they offer is the right thing for you. (Most lawyers will do that too.) Some people think they will automatically get a lot more from a larger company. I am not one of them. I think there are things more important than size.

Like what?

Understanding my point of view (which is just that, my point of view) will help you see my approach would look beyond the "degree", experience, education, or certification in every situation. An ongoing debate between me and two of my law school buddies for years during and beyond law school (which we attended in our 30s) revolved around whether you had to be a Boalt Hall graduate (i.e., UC, Berkeley Law School) to be a good and successful lawyer, to get a good job. What I was willing to concede was that if you want to get hired by a top echelon law firm, then it would be a distinct advantage to have a Boalt Hall degree. What I was not willing to concede was that to be a success you had to have a degree from a prestigious law school. What anyone does with their education and training determines whether they are successful or not. Unfortunately character isn't required to be successful - but a lack of it tends to surface in a short amount of time, sometimes at the interview process. A cavalier or egotistical response to every question or concern that you raise is NOT a good sign.

Life presents us with all kinds of choices. I didn't choose to work in the basement of a big firm and claw my way up after years logging "billable hours" to benefit the partners. I wanted to jump in and start building a practice I could enjoy from day 1. My cohorts put prestige higher on the spectrum of desirability than respect and service. I wanted the license to practice law so I could create my own perfect job and help people, not be forced into a slot created for a follower. There are standout managers like that. They strive for excellence.

Why is this important when discussing managers? Because managers are people with varied interests and backgrounds, and goals, and their commitment, people skills, and ethics should be high on the list of desirable traits. Sometimes people judge managers (and attorneys) by the "size of the company". I urge you to look deeper. While the large management have some very good managers, and I am not doing a global put down here, there are also smaller management firms and individual managers that excel and should not be overlooked. The bigger the firm, the farther away you are likely to be from the top dogs, especially if you are not the largest association (and therefore most important) on their roster. You may get delegated to the latest hire, the newbie. This happens in law offices too, and if you are assigned someone who lacks experience and training, you may end up suffering through their educational process. Newbies in training should have close oversight. If you use a smaller firm, you may end up with the attention or oversight of the company owner, because the company owners often are more "hands on" than the top members of a larger firm. In interviewing prospective managers, It is best to arm yourself with good questions, listen carefully, and strap on your bullshit meter. There are specific traits in the people who are going to manage that are important to look for, so here is a good place to start: Ask: "Who will be doing the hands on management of our HOA?" And "We want to meet that person before we hire." How can you assess a person if you cannot meet them face to face to get a feel for what they are about? You can review their skills from a resume, but that is only one part of the picture.

There are rare exceptions of course ... like me. I am an open book to the public. I do a lot of consultations with boards and owners who have never met me; but there is a reason people instill their trust. I write prolifically and offer many helpful tools for people and present a balanced view that inquires past one side ot the other in any given dispute or dilemma. My writings and presentation of solutions over several social media resources gives the public critical insight as to my approach to HOA matters. So never say never, but for hands on management, I think you need to meet and assess the person and see how they respond and interact with the board. And of course, for any manager or attorney, a glowing recommendation from another board who works with the manager would be important.

Traits I would look for include: knowledge, grit, determination, stamina, high morals and ethical practices, patience, courage, good listening skills, a wholesome and respectful personality, and an upbeat attitude. These traits support competence and flexibility needed to manage different types of associations and work effectively with different types of people. How do these traits come into play?

HIGH MORALS, HONESTY, COURAGE, ETHICAL PRACTICES: These traits need to be at the very top of the list. If you find a person you are interviewing or who is already working for your HOA shows signs of being furtive, secretive, less than forthcoming with answers to questions, defensive, a serious procrastinator, or unwilling to admit when they don't know something or make a mistake, beware. Note I said "unwilling to admit" that they don't know ... I DIDN'T SAY that it is necessarily a problem if they don't know something or made a mistake. No one knows everything and no one is perfect. It is the person who is honest, up front, and courageous enough to address a mistake head on or offer to get an answer for you to something they don't know that is the right person for the job. And in my experience, procrastinators -when they don't have something in the management report that they were supposed to investigate, report about, or seek feedback on - tend to blame others to cover their shortcomings. For example, I heard from directors on two occasions that a manager told the board of an HOA I provide services to that the reason they did not report to the board was that I had not responded in time for the meeting. Directors in both cases contacted me to ask "what's up?" because I was known for fast turnaround time. The 2 occasions where this happened went like this: (1) the manager sent me an email late in the morning requesting a 50 page contract review by 6pm, and (2) the manager never even requested feedback from me, but said he had. You can imagine this left me steaming and I can assure you (1) those managers will not use me as a scapegoat again and (2) I will never recommend them. In fact, in both of these cases I had a chat with the company owners. The company owner should not put up with this kind of conduct. What goes around comes around.

GRIT, DETERMINATION, STAMINA: These traits are valuable in the HOA arena because difficult challenges and crises arise. A board needs the help of someone who doesn't run, hide, bury their head in the sand, fly off the handle, become abusive, point fingers, jump to the blame game, or clam up when problems come to light. Most people look okay when things are peachy. But "sh_t" happens. Things that will test the manager might include: disruptive, abusive, suspicious or small minded board members; disgruntled owners; unexpected financial crises; disastrous events, or perhaps one of the worst from the manager's perspective, an uncomfortable ultimatum, "Do this not so savory or legal thing or risk being fired." When that happens, a manager needs to come back with, "No, I will not do that." In many cases, the board is puffing or bluffing and if anyone is advocating unsavory actions, they need to be called on it.

Here are some more specific examples of the kind of grit and determination I am talking about:

A manager who willing to attend a difficult board meeting or possibly even an HOA meeting to face accusers or complainers in order to regain or bolster trust by honestly answering questions or responding to misguided allegations or assumptions, or to boldly respond to false accusations.

A manager who is willing to push for responsible transparency even when it might lead to whining, complaints and questions, and who assists the board positively by gathering and providing valid and helpful information in a difficult crisis so the board may effectively present solutions and allay to the extent possible the fears of the owners.

GOOD LISTENING SKILLS, A WHOLESOME, A RESPECTFUL PERSONALITY, AN UPBEAT ATTITUDE: Management of an HOA is in equal part management, administration, and people business (community). Sure, there are accounting, record-keeping, communications and lots of other skills needed, but unless you are hiring management to provide financial services exclusively, dealing with the directors and the members will be a part of the job. This requires some decent people skills. It does not hurt to have special training in dealing with difficult people, mediation, or active listening, but special training is not necessary. A person can do well in management if well trained and is respectful, calm, patient, compassionate, business-like and willing to listen. Not everyone has to be a leader but everyone might end up having to stand up to an abusive or incompetent leader, so a strict follower is not desirable. And a manager who becomes the President's best friend is dangerous. Respect for a degree of separation is a must. Managers who take sides on a board or cling to certain directors are likely to be ousted during a new regime, as it should be if they have shown bias. Choose a manager who can do the job, not become your best friend. Likewise, argumentative or defensive people are not good for the job, unless you get some kind of perverse satisfaction from confrontation.

There are a whole host of other more practical things that are also important in choosing management.

Good Training: There are certification guidelines and requirements in California for a manager to call themselves a "Certified Common Interest Development Manager". The link to the article on my website explaining the law is: http://www.californiacondoguru.com/hoarticles/manager.html.

Good Organization: A manager who sets up files and records so that they can easily and conveniently be reviewed and/or retrieved by the directors, and that allows for owner review as well, for those records subject to review by the Civil Code in California (Section 5200).

Good References: It is important to get references. Of course a manager is going to put their best relationships on the reference page. They may have HOAs on the verge of jumping ship but be doing well with other HOAs. (Sometimes the problem is the board, not the manager.) I have seen articles online that state a board should ask for the manager's entire client list. If someone asked me that I would not give it. I have over 400 HOAs and clients I serve on an as needed basis and that list is for my eyes only. I also would not want to take the time to contact even 20 current board members to see if they want to receive calls, nor would I give out their information to anyone without asking. I have a list of 8-10 references who have offered to have their name on my lists of contacts for feedback. I have heard managers say that they will not give out their entire client list because other managers pose as inquiring board members to get it or boards get careless about who sees it. I believe that. If the manager has 3 or 4 or 5 or 10 solid references, I say stop calling after that.

Good Attitude: Have you ever seen Debbie Downer, a character on Saturday Night Live? She has something negative and depressing to say about any subject that is brought up. You do not want a negative, dramatic, or burned out manager running your affairs. If you want more information on what's important and how to choose a good manager or vendor, there is a Primer available on my website at www.californiacondoguru.com. From the main page you can go to the publications page or the webstore directly to purchase the Primer called "MANAGEMENT AND VENDORS - MV-1 - Choosing and Evaluating Vendors and Management for the Association. This Primer is about choosing vendors and managers for the association. You will learn what traits to look for, what questions to ask, what to look for in contracts, and how and when to evaluate those who provide services to the association. PRICE: $25.00."

The book THE SMALL HOA SURVIVAL GUIDE is also available in the webstore under GUIDES. It is a new publication and contains a specific chapter on management, what a manager does and why a small association may want to consider hiring management.

As for other resources, I found what I consider a very good article online about transitioning to a new management company- and this is the url link: http://njcooperator.com/article/considering-a-new-management-company.

And here is a good link to an article on what records should be kept (and this means managers should make sure these records are kept, and be willing to participate to achieve effective turnover if another manager is hired. It is a fact that many HOA boards can be fickle and come back to a manager finding they end up worse off after changing managers): http://www.echo-ca.org/article/hoa-record-keeping-your-filing-system-code.

And please beware, be vigilant, and do not place 100% trust in a manager such that as a director you become lazy or inattentive, especially to the financial records. Don't rely 100% on management reports. Examine invoices, check requests, bank statements and reconciliations. Keep track of contracts. Do contract review and evaluations every year. And read the following article online at http://www.hoacpa.com/articles.html. Fraud Happens - a True Story, by Catherine Kuhn, CPA; Cagianut & Company, CPA, WSCAI Journal, February, 2014. This article is both enlightening AND startling.

Again, besides my professional involvement in offering advice in bad management situations, I have personal experience. Quite a few years ago a well-known manager, owner of a well-known company in the Bay Area told me that he does not want a "meddling" board and does not want the directors educated on running the HOA because the manager's job is to manage the association and the board's job is only to set policy. This comment was triggered because I was recommending a board training session for the board of my own condo association that he managed. The board president was seemingly incompetent and in fact was blatantly violating association rules about pets, and recommending to realtors that buyers could ignore them. As it turned out, this manager for years was mistakenly paying a water bill that were the responsibility of the City, and the board missed it completely. Once uncovered by a new director who called me asking if I would talk to the manager, I did. I knew the manager. His response: simply said it was not his responsibility to recover the losses (which exceeded $30,000 over a period of a couple years) because his company was indemnified under the contract. That was true-he was protected legally.

I asked about his moral convictions and asked if he would do what he could to help the HOA recover these losses, including perhaps considering sharing in the loss since his company was responsible. His company had been originally hired by the developer of the condos and was retained by the association after turnover. His company was in the best position to accurately identify what expenses were and were not association expenses. His company railed against educating the board members. His response-total denial of any responsibility, even to chase the City for the money.

That was so unimpressive I recommended the board fire the company, and they did. Because of an onerous contract it didn't come cheap. Even having made a serious mistake that cost the HOA considerable money, the manager would not negotiate a compromise exit.

So I don't buy that boards should rely 100% on the manager or assume the highest regard for honesty and integrity. Boards need to be vigilant. They need to examine vendor contracts closely to see if they will be stuck with someone for a long time even after the relationship has gone south. They need to provide some oversight and checks and balances with regard to finances. Please look closely at the Kristin Davis story in the above-mentioned fraud article written by the CPA if you don't want to take my personal comments to heart. Here was a person trusted by many, highly regarded in the industry, who is now up for criminal charges for embezzling more than a million dollars from HOAs whose boards were not paying close enough attention. It could happen to you.

Many publications as well as the 2016 Davis- Stirling Act in Plain English are available in the Guru Webstore.

Just go to the store directly, or check out the articles, E-news archives and blogs first to see if you can find what you need. When ready, go to the store and see that there are tabs for the Books, Primers, Forms and Guides. Look for the new SMALL HOA SURVIVAL GUIDE).

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Mark your calendars for January 6th and the 20th for the first round of webinars. Announcement of topic and exact time to come later this month in December. We can have lunch together! The webinars will be at 11:30 am (for small HOA topics) and 12:30 am (for hot topics for all owners and associations).

Be sure also to visit the website and sign up for the next free E-News now! It's never too late. And watch the blogs for the hottest topics! If you want to unsubscribe, please do so when you get the newsletter. Sending an email does;t always work because I don't keep the list, Constant Contact does.

Be sure also to visit the website and sign up for the next free E-News now! It's never too late. And watch the blogs for the hottest topics! If you want to unsubscribe, please do so when you get the newsletter. Sending an email doesn't always work because I don't keep the list, Constant Contact does.

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I am an attorney who serves homeowner associations and homeowners alike (not inthe same association of course). I am a frequent contributor to the Echo Journal and other similar publications in the State of California and also contribute articles on a national level. There are several publications written in plain English onmy website written specifically to help people who need information about California law as it relates to homeowner associations. There is a wealth of information here on the website. I like to do service and have been lucky enough to be named Author of the Year by CAI after my first book, and was named 2011 Volunteer of the Year by the Executive Council of Homeowners.

Check out the Main and Resource Pages at www.californiacondoguru.com

Check out the popular book called "THE CONDO OWNER'S ANSWER BOOK" and both blogs developed, one for everyone and one especially for homeowner questions: www.Condolawguru.com

Check out the webstore for helpful and affordable publications on various topics, including 3 books, 28 primers and 2 guides. Most popular subjects are THE DAVIS STIRLING ACT IN PLAIN ENGLISH (book), ENFORCEMENT, BOARD BASICS, ARCHITECTURAL AND LEASE LIMITATIONS series (primers) and the RECALL and INSPECTORS OF ELECTION guides.

I have a private law practice in Pleasant Hill, but serve homeowners association and homeowners throughout the State of California. My practice is in large part now web based and telephone consultations are available. I have clients all over the state and am a real "road warrior".

Copyright Beth A. Grimm, All Rights Reserved


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